Editor’s note: This market commentary is provided by the Dairy Division at FCStone/Downes-O'Neill in Chicago, Ill.
The slowest week of the trading year began yesterday, and it was a lackluster session to say the least. Spot saw no price changes and the solo bid in barrels was enough to allow Class III prices to recover a slight bit of last Friday’s price-squashing. Whey prices remained firm, as well, which of course supports the Class III price as well. With only 587 contracts traded yesterday, it’s hard to put much merit on the session’s moves and we’ll leave it at that for now.
Corn and grain markets in general were all up big yesterday on continued concerns over S. American weather, primarily Argentina as it pertains to corn; the weather maps remain unfriendly. This marks the seventh consecutive gaining session for corn (grains) and we find it hard to buy on that streak. We would buy a pullback, but caution that any change in the weather maps could easily spur a short-term steep and swift price drop on simple profit-taking. But, as of this morning, the six- to 10-day dry forecasts haven’t changed much for South America.
We look for corn to open 7 to 9 cents lower and for beans to open 2 to 4 higher.
Daily CME spot market prices:
Block cheese: $1.5625 (unchanged)
Barrel cheese $1.56 (unchanged)
Butter: $1.595 (unchanged)
Grade A NFDM: $1.45 (unchanged)
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